The Nouvelle Plague

California Streamin'

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• BACK TO THE NORMAL

Here we are, seven weeks from Bond 25 being pushed to the fall, and I keep being haunted by the question of how in the hell are any of our studios going to come out of this intact, or still active in the theatrical business.

To state again, I don't think "movies are dead" or that the Corona period is going to kick off a brand new love affair between America with their couches. I think the "Get me out of this place" backlash has even greater potential to hurt the services after all this ends than anyone is factoring in.

What spurred Round 197 of this rumination today is the sinking sense that almost no one looking at this is taking into account how long this might go on, how uneven the off-ramp will be, and how impossible it is planning into that.

Nice of Georgia to try to reopen their theaters, but would they have shown? What will the next state that gets the bright idea show? Did they hold onto copies of Onward, that they can slap it up now? Super 8 films of the usher's grandparents’ wedding? Maybe Dinesh D'Souza can roll out another documentary and it can open on every screen in every theater in Georgia and become the highest-grossing opening of all time.

The most likely scenario we're looking at right now is waves of this continuing onward for another year plus. Through that, treatments will improve, testing damn well better improve, and we'll be able to cobble back together elements of civil society—in piecemeal fashion. But with this thing coming and going, with spikes and surges and renewed lockdowns, you might have some theaters open with temperature checks, or roping off every other seat, or requiring masks and gloves, or God knows what else, or all of the above. In other words, anything like full capacity by the fall . . . at the moment sounds more and more like a pipe dream.

Not to mention the fact that it's not good enough for America to be <RO 1.0 or whatever, you've got to account for the whole world. So if you're holding the keys to Bond or Wonder Woman right now, and you're looking ahead to September, how do you begin to guess what capacity U.S. theaters will be running at by then. Is it 40%? 60%? Then go ahead and take a shot at a good guess about what percent of the rest of the planet will be on lockdown at that point. Somewhere between 20% and 100% Maybe? Something in that range . . . .

Then remember that any country that isn't open for business within two weeks of launch will be lost forever thanks to piracy.

So do you get Bond out there, pray for a groundswell to overwhelm all else, or do you sit on it for, say, a couple of years and hope that

a) it doesn't leak out before thenb) there are still theaters to show it when the day comesc) anyone still remembers who James Bond is and why we care how he likes his martini

If you're MGM in this scenario, only the fate of your entire company rides on you getting this particular decision right.

So . . . . Given that's where things are going to progress, I still cannot wrap my mind around how there's going to be any of the good old-timey studios left alive when this is over.

DisneySurvivability Prospects: Fair to MiddlingEvery arm of its enormously high-overhead business is grounded. Can you even begin to picture when people feel comfortable spending a day standing on lines at Disneyland again? From today’s vantage point with X-ray hindsight, a year before a once-in-a-century pandemic wouldn’t be the ideal moment to take on mountains of debt and a billion hours of complexities acquiring one of your struggling rivals in exchange for The Simpsons, the remains of the X-Men and Fantastic Four, a slight shrinkage of the already tottering field, and a slice of Hulu.

The IP diamond mines Disney sits on will rule the world again, particularly as no one else is building remotely comparable mega-properties. The question is will the company as it exists now make it across the bridge to raise the flag of Mulan again? Or when we next join Marvel Cinematic Universe Phase 4, will it be under a new banner and new ownership?

If the world is back to normal by November, I’d say their chances are good. If this drags along for two years . . . . The TelephoniesSurvivability Prospects: Fair to F-ed UpMassive, eternal, Leviathanesque debt before all this in a business tied to the general waves of the economy like few others.

Launching its long-awaited but still fuzzily defined Netflix competitor almost three months into the quarantine by which time Netflix will have added another 20 million subs.

Which is especially unfortunate given that rather than picking a niche like D+, they are going for competing with Netflix at being “All of TV,” which is an expensive game to play. Want to know what that looks like, mashing the pieces of mass and class together and calling it television? That ends up looking something like this:

So much more . . . .

As we’ve seen, you can give the damn service to everyone on the planet, but if you don’t have anything they have to watch, they won’t be bothered. You can lead a horse to the app store but you can’t make him remember his password and figure out how to log in with the username from his cable company and remember to install it with the same username on all his devices.

(The Ankler Law of 10: A show must be ten times more exciting than anything available on existing subscriptions to make people adopt a new service.)

ComcastSurvivability Prospects: I guess so.The wrecking ball continues to lay waste to its core business, as its Disneyesque aspects—cable and tourism—suffer the same fate. And no, post-cable active scenario on the table. But the Roberts machine knows how to keep capital flowing. In the near term, they’ll find a way through. In the longer run?

SonySurvivability Prospects: Ummmm . . . .The ownership has wanted out of here for ages; I can't imagine anything about this moment is changing their feelings on that.

Word is they are looking to unload everything that isn’t nailed down to the streamers, including new Tom Hanks and Seth Rogen films, which brings in some cash in the short term, but risks burning the seed corn—and talent relationships (which are never un-rocky to begin with at Casa AMBEE).

Ultimately, Sony’s failure to develop a streaming platform despite being the only studio with a consumer streaming network in place pre-Netflix remains probably the biggest failure of the entire era. Its refusal even to peek down that road just continues to suggest a fearless determination by the owners to get the hell out of here the first chance they get. Who knows when that chance will come.

Meanwhile, a future as a producer of other services streaming content is at least a future, just not a Sony Pictures Entertainment-sized one.

ViacomCBSSurvivability Prospects:

Let's not even go there.

Then there are the minis: Lionsgate, MGM, STX. Lionsgate has cable money keeping it afloat, but they were working in a very tight corner before this. MGM, as noted above, has an impossible decision to make and almost no room for getting it wrong. So what keeps the lights on at the minis? STX has found a lifeline in Bollywood. Good for now, but how long will that keep the lights on?

When we consider the digital entrants among us, of course, Netflix is doing great. It's almost a Hollywood ending: Just as trouble was closing in, this earthquake shakes out the pack, and they run away with it all. As this piece puts it, in light of the most recent earnings call, Netflix has effectively "won" the streaming war. At least as it stands now.

I would argue there are no permanent victories here, but that's an argument for another day. At the moment, even with other competitors on the field, Netflix’s position is extremely formidable, to say the least.

The gods could not have built a more perfect iceberg to send at Disney, nor could they have designed a better concatenation of circumstances to aid The Service. Not only do they have the huge surge in subscribers but the shut down in production means that for this quarter at least, they can stop the spending spigot, and no doubt everyone will dutifully write: They're a profitable company! Take that, naysayers!

If only Netflix never had to pay for production again. Or if only it could take this moment to exercise a bit of restraint and discernment in its development process. But companies are what they are and winning certainly doesn't make Netflix change its ways, so expect the windfall of this period to be squandered in no time.

The thing about that, though: There's always stories and all, but the world is running out of Brand Name Showrunners to whom you can give $400 million and ensure a pipeline of attention-getting shows. So if Netflix has this windfall, and it wants to put it to use bulking up production even more . . . and it just so happens that much of the competition will be offering itself up at fire-sale prices soon enough: Is this finally the time to go shopping?

Amazon, of course, will emerge from this as the Gargantua devouring the world, having become the delivery system for all commerce. They will have plenty of money to make videos to lure in more diapers shoppers, or to chase the Bezos awards dream or to prepare users to abandon Planet Earth for their new homes in the Amazon Space colonies or whatever else they feel like doing.

And Apple remains Apple, Apple TV+ notwithstanding. Problem is: Despite years of rumors, forecasts, and demands, Tim Cook and company has shown no sign that it’s interested in buying a traditional studio and taking on all the headaches that would involve. Given Netflix's remaining debt bomb, how much more, even with its windfall, could it take on? Will Netflix's stomach prove smaller than its mouth?

The most elegant solution to this moment, as far as the financial world sees it, would be for tech to use this crisis to seal their inevitable conquest of content and just gobble up the studios—all of them. But I've heard that's about to happen so many times that I no longer believe it's ever going to happen, and my favored union to come remains Apple + Netflix.

So where does a future of theatrical fit in all of this? Working our way back down the line . . . . So Netflix, Amazon, and Apple emerge intact, in some combination—perhaps with a dismantled Paramount and Sony incorporated into them.

How Disney gets from here to there is a question mark, but assuming it makes it over the bridge, its strengths are not going to evaporate.

But looking at AT&T and Comcast, as they come out of the woods—broken, bloodied and pretty fairly bowed. When they peer over the landscape, the capital-F future is clearly in the hands of the streaming services: data rich, futuristic, better positioned to adapt and survey a scary landscape. As the Fast Company piece describes the Netflix earnings call:

It was impressive to hear Sarandos explain how the company resumed production on animation projects within days of having to close offices and post-production on already-shot projects sometimes within hours. It has pitch sessions and writers’ rooms operating virtually. He walked viewers through how the company works well in advance so that almost everything that the company planned to release in 2020 had already been shot and was in post-production—and the company’s 2021 slate is also well along. Netflix’s big holiday animated release, Over the Moon, was on track, as was season four of The Crown.

They are, God help us, just playing in a different world than the hidebound studios that have missed every chance to shake themselves up over the past years.

So if you are sitting in Brian Roberts’ or John Stankey’s chair, you're still in this world where you have this theatrical thing that you own. One that even in good times is nothing but headaches and a lot more famine than feast. In the bad times that we've just been through, they nearly brought down the whole company. You've got a business that you've got to rebuild after every project, where you're cut off from the customers by your exhibitors, where the slightest feint towards experimentation makes the entire business collapse with the vapors, where your missteps and flops—and you can always count on one of those being just around the corner—make you the center of public ridicule.

Yes, you've heard all this about creating cultural footprints and downstream revenue, but how much of that is starting to sound like showbiz fuzzy talk to justify spending money like you still just print it? And no one can explain to you why we have to watch Marvel run circles around us and we can't just do one of those?

The folks running the business today don't come from the movie world, by and large haven't shown any particular love for the medium, and certainly don't go to see movies with the general public.

The other day, Stankey put out a statement meant to reassure the world of his commitment to theatrical that, as so many Stankey PowerPointese statements do, provided convincing proof of the exact opposite of what he was saying.

Theatrical films have always been a major part of the our ecosystem. I fully expect that as we evaluate our business going forward, we will continue to champion creative work that is worthy of the theatrical experience.

Just a couple more qualifiers, and that statement could field an Olympic team.

If you ask your significant other how s/he feels about things between you at the moment, and his/her response includes the words “I fully expect that as we evaluate our relationship going forward,” take that as a sign that they’ve been in round-the-clock calls with their lawyers figuring out how soon they can get you off the premises, lockdown or no lockdown.

Let’s just say it’s not quite Warner Bros IS the movies. Or something like that.

All in all, I'd be feeling a lot more confident about the path through all this if we had a leader or two with a record of dedication to the movies and a bit of stature approaching a par with the gravity of the moment. Apart from perhaps Bob I, who do we think is going to stand up for movies through all this?

The problem with defections, I'm hearing, is that no one else out there is so confident of their own cash flow at this moment that they are offering up signing bonuses and equity to the heavens, like a defecting agent would expect.

What we've really got here is the denouement of the IPO journey coming home. Ari's merry band have followed him through the desert all these years, with their eyes fixed on the big prize, the massive payday for which they deferred all sorts of compensation over so many years.

Chasing that IPO dream meant buying into Ari's empire-building, which some may have been skeptical of, but a visionary leader's visions are not easily shrugged off, particularly when he takes a little breakaway shingle to the commanding heights alongside CAA at the peak of the industry. Particularly when the visionary leader is renowned for his loyalty to his peers, for nurturing the sort of esprit de corps that you don't typically find in the forbidding glass halls of the Death Star.

When it came out on the road to the IPO that the fearless leaders had made a little advance withdrawal on the surefire payday to the tune of $160 million each, eyebrows shot up a foot or two over some partners’ foreheads, but with everyone’s big cash out just months away, who was really going to quibble? Everyone would have their shares soon enough. When the money keeps rolling out, you don't keep books, as the song goes.

When the IPO failed, those raised eyebrows shot up again, but Ari promised and seemed to be on the road to finding the money to making things right for the partners. If everyone had gotten theirs—or some decent-sized piece of it—no one would be resurrecting how it all went down.

Then of course, the apocalypse. Not something a media company would've foreseen or planned for, but a very bad moment to finalize putting together the cash to keep your partners happy.

So now many of those compadres of the long march are facing not only not getting their big cash out for the long years of devotion, but salary reductions and potentially bonus eliminations. This will put them in a wildly different financial circumstance than how things appeared a few months back, when they were fully salaried, with bonus—and on the cusp of the jackpot.

Again, as the song goes, don't cry for them, Argentina. There are plenty of people in worse straits at this moment then the partners forced to trim their sails. The WME employees and support staff who have been or will be laid off, for instance, are a decent home for one’s sympathies.

But the question is: How does Ari and WME put this back together again?

Those $160 million withdrawals, which might have been fine had everything proceeded according to plan, have put a giant chasm down the middle of the vaunted WME esprit and left those who have come so far only to be left empty-handed for the time being openly wondering why the pain is not being shared equally here.

Equally puzzling is how the frenetic Emanuel has not managed to get out in front of this particular issue and pledge to give the money back, or turn over some portion of his shares . . . or something.

The claim that the company was hit by something bigger than anyone could've foreseen has the merit of being true, but beneath that giant wrecking ball, a world of sins could be swept. A reorganization in the name of responding to the crisis, selling off some of the business units, would be the expected route. But then Endeavor reverts to being just a normal agency, with no giant payout on the horizon.

In normal times, another agency might've swooped in and handed out giant signing bonuses to all the discontents. But if we were in normal times, we wouldn't be having this conversation in the first place. Will part of the agency break away? Perhaps the music division, as scuttlebutt suggests? Or will a cadre of mid-level agents leave to start something? That's always a threat for any big agency, and there's blood in the water at the moment, but it's also a notably scary time to be shaking up the business more than it's already trembling. Good luck getting clients to buy into a great big new heaping platter of risk.

•Tweet of the Week

• Burnett Notice

Some Ankler friends who share some of this newsletter's passions and obsessions were intrigued with the recent coverage of a recent court case.

Trade write-ups of the ruling that producers must release unaired footage from The Apprentice in response to a lawsuit against the now-occupant of the White House for an alleged marketing scam, all seemed to be missing, or nearly missing, one key detail: the name of the man who created and produced the show, a past—and according to reports, current—close confidant of the President, who always seems to keep that fact far away from his trade coverage and has done so once again.

Burnett is of course, technically, correct that the tapes are owned by MGM. That however omits that he was the creator of the show in question (and consequentially, architect of Trump's reinvention as outlined in this New Yorker profile. As it happens, Burnett also currently serves as Chairman of the television group of that company he refers queries on this to, the company where he incidentally engineered the ouster of the person who for all intents and purposes created it, in its current incarnation.

Burnett has in the past released a statement declaring that he has "never been a supporter of Donald Trump’s candidacy. I am NOT ‘Pro-Trump’"

If he says so.

It has been reported that Trump's Hollywood Svengali planned his inaugural festivities, has sought to make a show with Trump crush Vladmir Putin, has planned with Trump his post-Presidency show, and he continues to hold—or his company holds—the keys to the tapes which could . . . well, who, apart from Burnett, knows what they could do.

I'm not suggesting that anyone should be hounded out of Hollywood because of their beliefs or associations. We're in the business of show, and a headful of crackpot ideas is kind of a basic entry requirement, even if some of those ideas fall towards more gruesome precincts.

But all this stuff Burnett is involved in with the most powerful man in the world, along with his role in putting him in that position and perhaps keeping him there, seems like the sort of interesting thing you'd want to talk to a person about if you were a reporter. Yet Burnett has gone for years now as far as I can tell, operating at the top levels of Hollywood and affecting major decisions therein, his business dealings reported on regularly in one way or another, without ever once so far as I can find, submitting to questions about his political entanglements.

When things have gotten hot a couple times, he puts out a written statement, which the trades report, and that is that. And on we go, chronicling the new season pick-up of Beat Shazaam without anyone ever saying something like, "That video Trump showed at his latest COVID press conference, did you have anything to do with that?"

Just asking, as they say.

With stuff like the coverage of this suit, not even a token "Mark Burnett declined to answer questions about the tapes," for good measure. It's like no one wants to make anything awkward here for anyone.

Burnett continues to try to put as much daylight between himself and his erstwhile partner, in public at least, without, of course, directly criticizing him.

Last week, as the COVID situation continued to explode around the world, the mogul took to Twitter for the first time in three months to show his support—for Sean Penn.

And finally, while we’re in the realm of Burnett public’s profile, MGM, like many other companies announced cuts today. The previous announcements across the industry have been accompanied with or preceded by statements that the top brass would forgo salaries, or have them cut by some massive, and very specific eye-catching amount.

The real money for most of these folks is in their equity, so the salary moves are more signal fire than fire but, half-gestures are better than no gesture. As in the case of the MGM announcement which stated:

The MGM senior management team have taken voluntary pay reductions across all divisions of the company.

Just unspecified pay reductions? Nothing you care to add to that?

In all matters, it pays to be in a town, however, where being power means never having to be confronted with anything but praise and glory.

• Trading Places: The Axe Falls at THR

I’m going to have some more to say on this in the next issue, but before the blood dries, wanted to underline one little aspect of the firings at THR.

Weinberg is not yet a household name in the business, but among her colleagues was exceptionally well-regarded for a colleague still starting out. She’s been universally described to me as an incredibly smart, hard-working, diligent reporter and colleague, headed for a great career in journalism. In short, the sort of person any publication should want as many of as they can get.

So why did this Associate Editor whose salary presumably wasn’t breaking the Valence bank come to the attention of the honchos putting together The List?

Well, there’s one other bullet point in her career that certainly attracted the overlord’s notice. Among other work, Lindsay Weinberg was the author of the story about Jennifer Lopez’s signing with Guess despite looming harassment charges which provoked this exchange between the honchos and former editor Matt Belloni, as reported in The Daily Beast article entitled “Bosses Ordered Hollywood Reporter Chief to be Nicer to JLo.”

On another occasion, Brown complained to Belloni about the tone of a piece about Jennifer Lopez signing a new contract with the brand Guess, saying that she and the top editor “need to get on the same page” about coverage.

In that email to Belloni, she questioned why the author had included a line about sexual harassment allegations against Guess cofounder Paul Marciano, and reminded the top editor that MRC did business with Lopez.

“There's no real new reporting or expertise here,” Brown said. “How does this serve the industry, talent, or the company. You likely or the industry held Marciano accountable a year and half ago (truth to power).”

She continued: “We had an agreement that you would alert me to anything controversial - and this registers (as much by the headline) as in the multiple touch points to JLO in the company,” she said.

While THR could make you roll your eyes a few times a day, in between the round tables and the Power Lists and the luncheons, there were many reporters who managed to maintain a basic sense of reckless relentless probing and willingness to be a pest at the garden party, that is to say, a spirt of journalism. Of which the JLo reporting in question is a perfectly stalwart example.

And believe me, that spirit isn’t exactly in abundance anywhere in this business.

I don’t know what Valence’s intentions are going forward, but I know they you wanted to crush out that spirit of fearless probing, the best way to do it would be to make the newsroom feel a talented young reporter had been dismissed for showing precisely that quality.

I’m not sure if the Valence folks called up the JLo officiates and broke the news directly that “Justice has been served” (although I wouldn’t be surprised if they did). Would be nice if JLo and her folks would stand up however and say: Do Not fire reporters in my name!

More to come on this next week.

• The Daily Wells

“I’m committed to painting the kitchen today…Jesus. Straight white walls with chiffon lemon cupboard doors. After painting the living room (coral), bedroom (lily lavender walls with soft mint green cupboards) and the bedroom-bathroom foyer (white accented by SMG), I’m getting really sick of this. But at least it’ll be over after today. Or tomorrow as I might quit before day’s end. Maybe not.” - From “Posts Between Brush Strokes” at HOLLYWOOD ELSEWHERE

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